Does Convergence in Regulation Lead to Convergence in Practice? The Case of Dissident Proxy Contests in Canada

In this chapter we look at the question of convergence in corporate governance by evaluating dissident proxy proposals in Canada. We build on earlier research on the dynamics of dissident proxy initiatives in the US (David, Bloom, and Hillman, 2007) and in Canada (Bates and Hennessy, 2010), with a detailed evaluation of the actors who file and respond to dissident proxy proposals. What does convergence mean in this context? From a regulatory and legal perspective, corporate governance in Canada is very similar to the US, with a shared Common Law heritage as former colonies of Great Britain. Yet important differences also exist. Canada has much smaller capital markets organized around provincial regulatory agencies. Publicly-held corporations in Canada are concentrated in fewer sectors, and large Canadian corporations are, on average, much smaller than large US corporations. Canadian regulations have enabled families to control corporations with supermajority voting shares. Founders and heirs who serve as executives are regularly featured in the Canadian business press, as are executives at large institutions. The discourse around corporate governance in the Canadian business press reflects the proximity of the US and exposure to print and broadcast media creating a ration-ale for convergence around codes for corporate governance (Enrione, Mazza, and Zerboni, 2006).